The Biden administration’s decision to abruptly cancel a plan to purchase up to three million barrels of oil for the Strategic Petroleum Reserve (SPR) has sparked debate and raised concerns about national security and economic stability.
The SPR, established by Congress for emergency situations, has seen a significant decline in its reserves since President Biden took office in January 2021. Initially, the Biden administration began depleting the reserve to tackle high fuel prices, but the recent cancellation of the refill plan signals a shift in strategy amid increasing oil prices.
The Department of Energy (DOE), responsible for managing the SPR, cited market conditions as the reason behind the cancellation. Despite the commitment to refill the reserve, the DOE stated that it would not award the solicitation for oil delivery to the Bayou Choctaw site in Louisiana in August and September, as initially planned.
The decision comes as oil prices have surged, with the U.S. benchmark hitting $85.71 per barrel. The DOE had aimed to purchase oil priced at $79 per barrel or below, but the current market conditions have made this goal challenging to achieve.
While the Biden administration has initiated several purchases to refill the SPR in recent months, the reserve remains at historically low levels. Republican lawmakers and energy experts have criticized the administration’s actions, warning that they leave the U.S. vulnerable to short-term supply shocks.
Daniel Turner, founder and executive director of the watchdog group Power the Future, criticized the administration’s approach, accusing it of draining the SPR for political reasons and neglecting domestic oil production. He argued that these actions not only contribute to higher fuel prices but also leave the SPR less prepared to handle potential crises, especially amidst rising turmoil in the Middle East.
“It’s pure insanity to watch the Biden administration cut American oil production and then claim they can’t refill our critical reserve because of the price,” said Turner.
“Joe Biden drained the SPR for political reasons, cut our domestic production for his climate agenda, and now he’s leaving our critical reserve more vulnerable because he’s incompetent,” he continued. “As a result, Americans are paying more at the pump, more at the grocery store and our SPR is less full during a time of rising turmoil in the Middle East.”